BUY TO LET AND PORTFOLIO LANDLORDS
Borrowing in the buy-to-let (BTL) market is complicated. In most cases lenders will have a calculation which can determine the maximum amount they are willing to lend. It is mainly based upon the expected market rental income of the property, your personal income tax status, the product and if you are releasing further capital out of the property.
In addition most will have a minimum income requirement that you have to meet.
If you are a first time buyer wanting to buy an investment property those who will lend will assess borrowing on your personal income status as though you were buying a new home. The minimum deposit tends to be 25%.
If you have more than 5 properties or a portfolio there are lenders offering specialist products available for the professional property landlord and we strongly recommend that you speak to us for professional help in these areas to assess the options available to you.
The Limited Company route is also a more popular way to purchase properties, while products are limited and rates and fees tend to be higher, there can be tax benefits. Evermore Capital cannot provide tax advice. Please speak to your accountant for tax advice regarding Limited Company property purchases and transactions.
The actual mortgage process for BTL products work in the same way as a residential purchase or re-mortgage although different documents will be required and the case is focussed on the rental income. The tenancy type also plays a part. If you are buying an HMO property please be aware lender choice is limited and you do need to make sure you have a valid licence.
You are also able to release equity from rental properties, in some cases port the mortgage to new properties and be offered product transfer rates from your existing lender.
For the developers we have access to bridging loans and development finance.
While we are here to help as much as possible we are not tax advisers and it is strongly recommended that you speak to someone regarding the taxation of a buy-to-let property; income tax and capital gains in particular as well as the submission of tax returns. Remember if you already own a property you will also be liable to additional stamp duty.
“The Financial Conduct Authority does not regulate all Buy to Let mortgages”
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